Oil policy changes bring more public scrutiny to drilling

Salazar says new rules should ensure stricter standards in leasing

WASHINGTON - Interior Secretary Ken Salazar on Wednesday announced policy changes he said will bring more scrutiny and a greater public voice in how oil and gas leases are awarded on public lands.

Salazar said the changes should ensure stricter environmental standards in oil and gas leasing while bringing more clarity to the process to energy companies hoping to drill on public lands, mostly in Western states.

"We don't believe we ought to be drilling anywhere and everywhere," Salazar said at a news conference. "We believe we need a balanced approach and a thoughtful approach" that allows development of oil and gas leases on public lands while also protecting national parks, endangered species and municipal watersheds.

Salazar, a former Democratic senator from Colorado, criticized the Bush administration for what he called a "headlong rush" to lease public lands. Early last year, Salazar suspended 60 of 77 leases in Utah approved in that administration's waning days.

The changes announced Wednesday are intended to bring greater consistency and public engagement to onshore oil and gas leasing, Salazar said, with a goal of reducing legal challenges that have cost taxpayers millions of dollars and energy companies months or even years of delays.

About 1 percent of oil and gas leases on public lands were protested in 1998, he said - a figure that jumped to about 40 percent in 2008. The main reason for the increase was that leases were offered in places where they should not have been or without enough agency scrutiny or public participation, Salazar said.

"In the prior administration the oil and gas industry were the kings of the world. Whatever they wanted to happen, happened," Salazar said, adding that those days are over.

The Bureau of Land Management, which oversees oil and gas rights beneath federal property, will issue new guidelines to its field staff on how to review proposed parcels for development. A recent report by the Government Accountability Office found that previous decisions had been made arbitrarily and with little consultation with other agencies. Under the new guidelines, teams from several agencies will consult and officials will physically inspect the sites rather than making decisions from behind their desks, said Bob Abbey, the bureau's director.

The agency also will issue guidance regarding the use of "categorical exclusions," which allow for expedited oil and gas drilling without detailed environmental reviews that normally are required. The GAO found that the land management bureau has frequently misinterpreted and violated a federal law allowing categorical exclusions.

Democrats and environmental groups hailed the announcement, saying it marked a significant step toward a balanced approach to energy development on public lands.

"The reforms announced today will help ensure that wildlife, water and our public lands receive the important protections they deserve," said Carl Pope, executive director of the Sierra Club.

But Republicans and industry groups said the changes would continue the Obama administration's pattern of delaying development of natural gas on federal lands in the West. The changes will create extra layers of red tape that will allow government bureaucrats to trump the expertise of geologists and engineers, the Independent Petroleum Association of Mountain States said in a statement.

Kathleen Sgamma, the group's director of government affairs, said Interior was blocking more than $100 million worth of leases that companies have paid for but cannot gain access to.

"This administration has leased less acreage than any other on record and appears determined to throw up every roadblock possible to stall and ultimately halt energy development on federal lands," said Rep. Doc Hastings, R-Wash., the senior Republican on the House Natural Resources Committee.

But Rep. Nick Rahall, D-W.Va., the panel's chairman, said the changes "move us closer to balancing the scales after a decade in which oil and gas companies had free reign to run roughshod on America's public lands."